SunTrust reports $535.6 million profit

SunTrust Banks Inc., the seventh-largest U.S. bank, said profit rose 4.9 percent in the third quarter on increased lending and the sale of a bond-trustee business.

Earnings rose to $535.6 million, or $1.47 a share, from $510.8 million, or $1.40, a year earlier, the Atlanta-based bank said Tuesday. Revenue increased 1 percent to $2.03 billion and average loans advanced 9 percent.

SunTrust's sale of its municipal and corporate bond trustee business to U.S. Bancorp resulted in a $113 million gain.

"Despite strong year-over-year loan growth, the rate of revenue growth was slower than in prior quarters due to the challenging operating environment," said L. Phillip Humann, SunTrust's chairman and chief executive officer.

The company was expected to earn $1.46 a share, based on the average estimates of 27 analysts surveyed by Thomson Financial.

Next year, SunTrust expects loan growth to be in the "upper single digits," Chief Financial Officer Mark Chancy said on a conference call with investors. Net interest income will grow in the "mid-to-upper single digits" and noninterest income will be in the "upper single digits," he said.

Shares of SunTrust fell 84 cents or 1.1 percent, to close at $78.02 on the New York Stock Exchange.